Uprates cost-effective despite price increase

01 May 2012

Projected costs for ongoing uprates at four Florida Power and Light (FPL) nuclear units have increased by over half a billion dollars - but will still save customers around $3.8 billion in fossil fuel costs over the long term, the utility claims.

In a detailed update of its nuclear investments filed with the Florida Public Service Commission (PSC), FPL noted that the work to add a total of 490 MWe across Turkey Point units 3 and 4 and St Lucie units 1 and 2 is now expected to cost approximately $2.95-3.15 billion. This increase from a previous 'non-binding' estimate of $2.32-2.48 billion is driven by additional labour and engineering needed to support regulatory requirements, 'design evolution' and the logistics of construction and implementation.

Nevertheless, the company describes the uprate project as "still solidly cost-effective." Based on latest projections, the uprate will save an estimated $3.8 billion on fossil fuels such as coal, natural gas and imported oil over its lifetime, said FPL.

Indeed, customers are already feeling the benefits of the uprate program according to FPL. Some 31 MWe has already entered service as a result of the ongoing uprate, and a further 336 MWe will be added during 2012 as work is completed at three out of the four units. The final work will be completed early in 2013. The uprate will see the capacities of the two St Lucie units increase by 12% each, with the Turkey Point units increasing by 15%.

FPL filed its submission with the PSC as part of an annual review process in support of its application to recover some of its nuclear investment costs from its customers. The company is requesting the recovery of approximately $151 million in 2013 to support its two major nuclear investment programs - significantly less than the $196 million it requested for 2012. Most of the $151 million will support the uprate program, while some $20 million will go towards expenses associated with efforts to secure the necessary licences for it to build two new AP1000 units at Turkey Point. FPL's construction and operation licence application for the plant, submitted to regulators in 2009, looks likely to receive a final decision in 2014.

For residential electricity customers, FPL estimates that the updated figures will mean an increase of about $1.41 per month on a typical bill in 2013, a lower increase than previously forecast and well below the national average.